(Repeats April 11 story with no changes to text)
* Woolworths confident it can quickly improve David Jones
* Some analysts say $2 bln in price could be better spent elsewhere
* Aims to build up private labels, online offerings
* Also seeks to improve inventory management, branded credit card
By Byron Kaye and Tiisetso Motsoeneng
SYDNEY/JOHANNESBURG, April 11 (Reuters) - Making one of the biggest bets on the Australian retail market by a foreign firm to date, South Africa's Woolworths Holdings thinks turning around David Jones Ltd will be a slam dunk.
Woolworths has much working in its favour with its $2 billion punt on the 180-year-old Australian firm - a track record of rapid growth, a chief executive with long experience in Australia's retail market and plans to leverage greater scale to cater to the countries' common fashion seasons.
Australia's No. 2 department store operator, by contrast, has been bedevilled by boardroom fiascos and a failed foray into online shopping. Like bigger rival, Myer Holdings Ltd, it is seen as very much on the backfoot against foreign "fast-fashion" apparel retailers like Inditex's Zara and Hennes & Mauritz AB. Its profit has halved and its share price has fallen 40 percent since 2010.
For those reasons, Australian retail experts give Woolworths CEO Ian Moir, a straight-talking Scot who led the company's existing Australian business - upmarket clothing retailer Country Road Ltd - for nine years, more than a fair shot at putting David Jones back on its feet.
But at $2 billion, the planned acquisition is also expensive for a company with a market value of $5.7 billion, and some analysts worry that Woolworths is paying too much for an asset that won't yield the high growth that could be achieved in Africa, where retail sales are growing about 30 percent a year.
"South Africa is becoming more competitive, more over-traded so a lot of retailers are looking outside for growth and the rest of Africa is an obvious conclusion," said Roger Tejwani, an analyst at Cape Town-based Noah Capital.
"My concern is they are trying to chase growth outside of South Africa but they are doing it at the wrong place and price."
Shares in Johannesburg-listed Woolworths have lost 6 percent since news of the deal.
Woolworths, which pulled out of Nigeria late last year, still plans to expand in African countries such as Kenya and Mauritius, its head of international operations Paula Disberry said on Thursday, but she added that a lack of good shopping malls was inhibiting growth.
Under Moir, Woolworths' profit has more than doubled in the past five years and its shares have risen almost 500 percent during the same period, making it a must-have in fund managers' portfolios.
Woolworths has benefited from a two-pronged approach of catering to its traditional luxury-seeking customers while also developing less expensive aspirational brands to attract the nation's fast-growing black middle class.
And Moir, who will be broadly trying to replicate his Woolworths strategy in Australia, sees a lot of simple fixes for David Jones, which he said in a call with analysts "had kind of lost sight of the customer" in its brand and store management.
One key area will be quickly building up what he calls David Jones' "woeful" private label sales to 20 percent of total sales from 3 percent currently - an aim that is central to his plans to add A$130 million to the Australian firm's annual profit within five years.
That would be on par with Woolworths, whose inhouse brands have helped it gain a net earnings margin of about 8 percent, above David Jones' 5.5 percent, although less than Inditex and H & M which enjoy margins of around 14 percent.
The company is expected to bring its flagship jeanswear brand RE: as well as its Studio. W brand for professional and formal wear to the Australian market.
Online shopping will be another big focus. Burned by a foray into the early e-commerce wave that yielded little in the way of sales, David Jones put off any further serious investment in online until too late, preferring to focus on store overhauls and cost controls.
As the fallout from the global financial crisis has driven shoppers to seek better deals online, the A$18.7 billion Australian department store sector has shrunk by almost 2 percent annually in the five years to 2014, according to industry researcher IBISWorld.
Meanwhile, Australian online shopping has grown at up to 30 percent annually in that period, with that growth stabilising to about 11 percent in 2013, according to National Australia Bank.
In the briefing with analysts, Moir noted that Country Road's online sales were greater than David Jones' web-based sales despite the department store being a much bigger business. Under new management Country Road Group brands will immediately be on offer on David Jones's website, he added.
He also said fixing David Jones' customer relationship management was a priority, noting that only 20 percent of its customers used the department store's branded credit cards compared to 70 percent at Woolworths and 85 percent at Country Road. Building a faster inventory management to better compete with the likes of H&M and Zara was also key.
"There's going to be more northern hemisphere guys coming into the southern hemisphere, trying to compete with southern hemisphere retailers," Moir said.
"You either embrace that and build a competitive platform to compete against that or you're not going to survive." (Editing by Edwina Gibbs)